Raw sugar futures have seesawed this month as the July-21 contract expired and a lack of fresh fundamental inputs pushed the market around. Given the lack of fresh fundamental news, sugar market participants kept a keen eye on CS Brazil and its current crush. The July-21 contract expired with 130,000 tons of Brazilian sugar delivered to the tape by Glencore, with Wilmar as sole receivers. Weather concerns in CS Brazil have become a moot point as the latest UNICA report for 2H June highlights better cane crushing and sugar output statistics. Sugar saw some follow-through weakness from the grain market last week and looks technically soft in the near term. We expect some support around 17 USc/lb as prices get closer to ethanol parity.
AUD price action has chopped lower over the last month. Key drivers for global markets appear to be the trajectory of rate hikes and tapering of quantitative easing programs around the world from the respective central banks. With the economic jobs and inflation data continuing to show a return to some sort of normality, the focus for central banks moves towards how consistently the presented data remains. The AUD has made a clear break from its painstaking USD 0.77– 0.80 range and looks set to face more downside pressure as quantitative easing tapers and rate hike talks heighten.